I've been reading Infoworld for many years. Heck, I used to advertise in it in the late 80s when I was marketing a computer graphics product. It's sad that it's so small now--only 48 pages with only 15 advertisers this week. I guess that's a gauge of the IT market right now.
There's still a lot of information in the pages, though. Here's an interesting column by Ephaim Schwartz on figuring out the best returns on different products. He started out comparing different analyst firms, but what I found interesting was the analysis of different financial calculations.
He mentions don't just look at total cost of ownership (TCO). That has been the big buzz word of the major automation suppliers for quite a few years. But it only addresses the cost side of the ROI equation. What about the benefit side? Did it cost more but bring in substantially more returns? Maybe that's good. His other nugget was the time frame question. Instead of saying "X gives us a return of 10% per year" some compound the return and say something like "X gave us a return of 100% over 10 years." Actually it just gave 10% per year. Now compare that to the opportunity cost of funds.
So, how do you calculate return? Just look at TCO? Massage the numbers to make them look better? Compare to opportunity costs and returns? Do you even calculate them at all?
This is part of what we want to cover at Automation World. Send me your ideas offline. Be part of a story.
3:06:04 PM 
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